Sunil Krishnaji Kate, Pune V. Assistant Commissioner of Income-tax,

ITA 724/PUN/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9241 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 1 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 19-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIL CHAWARE
• Assessee Lawyers: D R BARVE
• Keywords: Sale consideration of property below Jantri Value; Value adopted by valuation officer; Fair market value; Valuation report; Onus to prove
• Section: 143(3); 50C

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO.724/PUN/2015 / ASSESSMENT YEAR : 2010-11 SHRI SUNIL KRISHNAJI KATE, PLOT NO.501, ALLIANCE CHAITANYA, BHAKTI MARG, LAW COLLEGE ROAD, PUNE 411 004. PAN : ACJPK3046K. . / APPELLANT V/S ASST.COMMISSIONER OF INCOME TAX, CIRCLE 5, PUNE. . / RESPONDENT / APPELLANT BY : SHRI D.R. BARVE. / RESPONDENT BY : SHRI ANIL CHAWARE / ORDER PER ANIL CHATURVEDI, AM : THIS APPEAL FILED BY THE ASSESSEE IS EMANATING OUT OF T HE ORDER OF COMMISSIONER OF INCOME TAX (A) 3, PUNE DT.09 .02.2015 FOR THE ASSESSMENT YEAR 2010-11. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON R ECORD ARE AS UNDER :- 2.1 ASSESSEE IS AN INDIVIDUAL STATED TO BE DERIVING INCOME O N PROFESSION, CAPITAL GAINS AND OTHER SOURCES. ASSESSEE FILED HIS RETURN OF INCOME FOR A.Y. 2010-11 ON 26.09.2010 SHOWING TOT AL / DATE OF HEARING : 05.06.2017 / DATE OF PRONOUNCEMENT: 30.06.2017 2 INCOME OF RS.46,18,992/-. THE CASE WAS SELECTED FOR SCRUT INY AND THEREAFTER ASSESSMENT WAS FRAMED U/S 143(3) OF THE ACT VIDE ORDER DT.20.03.2013 WHEREIN TOTAL INCOME WAS DETERMINED AT RS.94,31,290/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE C ARRIED THE MATTER BEFORE LD.CIT(A), WHO VIDE ORDER DT.09.02.2015 IN (APPEAL NO.PN/CIT(A)-3/ACIT CIR-5, PUNE/488/2014-15) GRANT ED PARTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE ORDER OF LD.CIT(A) ASSESSEE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FO LLOWING GROUND: THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS)-3 , PUNE HAS ERRED IN IGNORING THE FACT THAT THE APPELLANT HAD T O SELL THE SUBJECT PROPERTIES WITH ITS PECULIAR DEFECTS AS REPORTED B Y THE GOVERNMENT REGISTERED VALUER IN ITS VALUATION REPORT ALONG WIT H PHOTOGRAPHS ETC. HE SHOULD HAVE CONSIDERED THE REALISTIC VALUA TION AS HELD IN THE CASE OF RAVI KANT VS. ITO (2007) 110 TTJ DELHI 297. IT IS PRAYED THAT THE VALUE AS SUBMITTED BY THE APPELLANT BE HEL D AS CORRECT VALUE INSTEAD OF TECHNICALLY APPLYING THE STAMP DUT Y VALUE. 3. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, AO NOTICE D THAT DURING THE YEAR UNDER CONSIDERATION ASSESSEE HAD SOLD PROPERTY CONSISTING OF SHOP AND BASEMENT AND THE VALUE ADOPTED FOR STAMP VALUATION WAS RS.78,88,680/- AND RS.19,38,732/- RESPECTIVELY. HOWEVER FOR THE PURPOSE OF COMPUTING CA PITAL GAINS, ASSESSEE HAS CONSIDERED THE SALE CONSIDERATION OF RS.46 LA KHS (FOR BASEMENT) AND RS.14 LAKHS FOR OFFICE PREMISES. THE ASSESSE E WAS ASKED TO SHOW CAUSE AND TO EXPLAIN AS TO WHY THE PROV ISIONS OF SEC.50C OF THE ACT NOT BE APPLIED. THE ASSESSEE INTER- ALIA SUBMITTED THAT SINCE THE PROPERTY HAD NO MARKETABLE VA LUE FOR VARIOUS REASONS, PROVISIONS OF SEC.50C WERE NOT APPLICABL E. HE FURTHER REQUESTED TO APPOINT A VALUATION OFFICER FOR THE V ALUATION 3 OF THE PROPERTY. AO ACCORDINGLY MADE A REFERENCE TO VA LUATION OFFICER ON 21.11.2012 AND IN RESPONSE TO WHICH, THE VALUATIO N OFFICER DETERMINED THE FAIR MARKET VALUE OF THE PROPERTY AT RS.1,10,37,000/-. AO ON THE BASIS OF VALUATION DETERMINED BY THE VALUATION OFFICER DETERMINED LONG TERM CAPITAL GAINS AT RS.48,12,297/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CA RRIED THE MATTER BEFORE LD.CIT(A), WHO UPHELD THE ORDER OF AO AND G RANTED PARTIAL RELIEF BY HOLDING AS UNDER : 3.4 I HAVE CO N SIDERED THE SUBMISSION MADE BY THE APPELLANT AND ' PERUSED MATERIAL ON RECORD. THE FACTS OF THE CASE I NDICATES THA T T HE APPE LL AN T PURCHASED THE SHOP AND A BASEMENT FOR A CONS I DERAT I ON OF RS.4 . 50 L ACS AN D 10 L ACS ON 13 . 04.2006 AND THE AFORESAID PREMISES HAVE BEEN SOLD O N 04. 0 3 . 2010 FOR A TOTAL VALUE OF RS . 14 L ACS AND RS . 46 LACS FO R SHOP A N D BASE M EN T A ND T H E RESULTANT CAP I TAL GAIN OFFERED TO TAX . THE ASSESSING OFFICER H OWEVER , ADOPT ED TH E VA L UE ' DETERMINED BY THE VALUER TO WHOM A REFERENCE HAD BE E N M AD E AS P E R THE PROVISIONS O F SECT I ON 50C , WHICH WAS AT A HI GHE R VALUE THA N T H E ST A M P DUTY VA L UE . I N FACT THE ' S T AMP DUTY VALUE FOR THE SHOP WAS OF RS . 78 , 88 , 680 1- A N D F O R THE BASEMENT OF RS . 19 , 38 , 732/- AS AGAINST RS . 46 LACS AND RS . 1 4 L ACS AS PER THE SALES CONSIDERAT I ON SHOWN BY THE APPEL L ANT . THE APPE L LANT , HOWEVE R , OBJECTED TO THE AFORESAID VALUATION BEING ADOPTED BY THE ASSESS IN G OFF I CER AN D HENCE THE ASSESSING OFF I CER AS PER THE PROV I SIO N S OF SE C T I O N 50C REF E RRED THE MATTER T O THE VALUE R O R T HE D I STR I CT VA L UAT I ON OFF I CE R W HO V A LU E D TH E AF O RE S AID PROPERTY AT RS. 1 ,10 , 37 , 000/- BEING RS . 25 , 85 ,1 20/- F O R T HE SHOP AN D R S. 84 , 52,158/- FOR THE BASEMENT, WHICH VALUE HAS BEEN ADOPTED BY T HE A SSE S S I N G OFFICER FOR WORKING T HE LONG- T ERM CAPITAL GAIN. 3.4.1 T HE APPELLAN T H A S FURTHER C ONTE ND ED THAT THE DVO HAD T E L EP H O NI CA LLY I NTIM A T E D THE A P P ELLA NT ON 23 .01.2 0 13 , ARRIVED IMMED I ATELY AND CO M P L E T E D THE INSPECTION IN A FEW MI N UTE S O N TH E VERY DAY AND HAS ADO PTED THE C O M PA RABLE SALE INSTA NC E METHOD F O R V ALUATI O N. THE APPE L L ANT H AS ALSO - E MPH AS I ZE D THAT AT TH E T I ME OF INS PECT I O N DO N E BY THE DVO THE PUR C HASER HAD MADE CHAN GES I N TH E SPECIFI CATIO N S OF THE PRE MI SE S AND MODIFIED THE TOTA L INTERIORS AN D HEN C E TH E REAL C ONDI T ION OF THE PR E MI S E S A T TH E T I ME OF S A LE WAS NOT IN E X ISTENCE A T TH E TIME O F INSPE CT I ON BY THE DVO. TH E APPELLANT H A S THUS PLACED EMPHASIS ON T HE V A LUATIO N DO N E BY THE GOVT . REGIS TER ED VALUE R, M/S KULKARNI VALUERS PVT . LTD . WHO VALU E D THE SHOP AT RS. 14,26,000/- AND THE BASEMENT AT RS . 48, 3 1 , 000/ - . IN TH I S R E GARD ON PERUSAL OF THE REPORT OF THE DVO DATED 27 . 02 . 2013, IT IS NOTICED THAT THE NOTICE HAD BEEN ISSUED TO THE A PPELLANT BY THE . DVO VIDE NOTICE DATED 26.12.2012 SEEKING PRODUCTION OF DETAILS / DOCUMENTS BY 10.01 . 2013 INCLUDING THE REGISTERED VALUER'S REPORT IF ANY AMONG OTHERS AND ONLY THREE DOCUMENTS VIZ . THE PURCHASE DEED, SALE DEED AND COPY OF PLAN WAS SUBMITTED BY TH E APPELLANT . 4 FURTHER THE APPELLANT SHRI SUNIL K . KATE WAS ALSO PRESENT ON 23.01 . 2013 I . E . THE DAY ON WHICH INSPECTION WAS CARRIED OUT . THE DVO HAS TAKEN INTO CONS I DERAT I ON THE PERIOD OF CONSTRUCTION OF THE PROPERTY I . E. 1985 AND ALSO THE SPEC I FICATION AS PER PARAS 3 . 4 AND 3.5 OF THE REPORT . THEREAFTER, THE DVO ADOPTED AS MANY AS SIX SALE INSTANCES OF THE PROPERTIES WHICH WERE INFE R IOR TO THE PRESENT PROPERTY LOCATION-WISE AND ONLY THEREAFTER , THE PRELIMINARY VALUATION DONE IN FORM NS-6 ALONG W I TH THE ANNEXURES S HOWING THE DETAILS OF VALUATION AND THE LI ST OF SALE INSTANCES WAS SENT TO T HE APPE LL ANT SEEKING OBJECT I ON , IF ANY VI D E LE TT ER DATED 08 . 02 . 2013 . THE APPELLANT WAS ASKED TO SUBMIT THE OBJECTIONS TO THE SAID PREL IMINARY VALUATION BY 25.2.2013 , HOWEVER , NO OBJECTION TO THE PROPOSED VALUATION WAS SUBMITTED BY THE APPELLANT NOR THE AP PELLANT SUBMITTED THE REGISTERED VALUER'S REPORT IN THIS RE GARD . THE DVO THEREAFTER, MADE THE F IN AL V ALUAT I ON OF THE TWO PROPE R TIES A T RS. 1, 10 , 37 , 000/- . THUS, THE DVO IS SEE N TO HAVE PROV I DED AMPLE OPPORTUNITIES TO TH E APPELLANT T O SUBMIT ITS OBJECTION T O THE VA L UA TI ON DONE BY H I M . THE REPORT OF THE REG I STERED VALUER M/S KULKARN I VALUERS PVT . LTD . IS DATED 10.04 . 2013 I . E. THE SAME DATE ON WHICH THE VALUER V I S I TED AND INSPECTED THE SA I D PROPERT I ES . THE VALUER HAS ALSO NOT SPECIFIED SPECIFIC SA L E INSTANCES EXCEPT FOR T HE GENERAL RE F ERENCE TO THE RANGE OF PRICE PREVALE N T B A SED UPON WHICH THE VALUAT I ON HA S BEEN DON E BY H IM AS I S EV I DENT F R O M THE REPORT. TH E R EPO R T OF TH E R E GI S TERED VALUE R I S BASE D UPON T HE PAPERS S H O WN AN D I NFORMATION G I VEN T O HIM. T HE APPELLANT IN A NY C A SE HAD BE EN PROVIDED W I T H SUFFIC I ENT OPPORTUNITIES TO FUR NISH ITS OBJECTION TO THE FI N DINGS A N D V A L UATION DON E B Y THE DVO, WHICH TH E A PPELLA NT F OR TH E R EASO N S BEST KNOWN T O H I M D ID NOT FU RNIS H H IS SAY AN D OB J ECT I ON IN THE MA TT ER . TH E REG I STERE D V ALUE R ' S REPORT D O NOT I NDICATE ANY FINDINGS WHICH ARE CONTRARY TO THE FINDINGS OF THE DVO EXCEPT FOR THE FACT THAT THE CONDITION OF THE PREMISES HAS BEEN STATED TO BE BAD . IT IS RELEVANT T O P O IN T OUT THAT EVEN THE VALUATION DONE BY THE REGISTERE D VALUER ON 10.04 . 2013 I S SUBSEQUENT TO THE DATE OF SALE AND THE PURCHASER HAD ADMITTEDLY MADE CHANGES IN SPECIFICATIONS AND MODIF IED THE INTERIORS AND THE REAL CONDITION OF THE PREMISES AS STATED BY THE APPELLANT WAS NOT IN EXISTENCE A T THE TIME WHEN INSPECTION WAS DONE BY HIM IN APRIL 2013. MOREOVER, THE APPELLANT HAD SUFFICIENT TIME TO GET THE VALUATION DONE FROM THE SAME REGISTERED VALUER BEFORE THE COMPLETION O F THE VALUATION BY THE DVO. THE DVO HAS DETERMINED THE FAIR MARKET VALUE OF THE PROPERTY BASED ON SOUND FACTUAL BASIS AND THE PHENOMENAL DEV ELOPMENT IN THE AREA WHICH CANNOT BE REJECTED WITHOUT ASSIGNING SPECIFIC AND COGENT REASONS. THE REPORT IS A VA L ID PIECE OF EVIDENCE I N DEC I DING MATTERS OF VALUAT I ON AN D S UC H REPORT CAN BE MODIFIED OR QUESTIONED OR REBUTTED ONLY IN THE LIGH T OF R EL IA B L E MATERIALS AVA I LABLE , WHICH IS NOT SO AS I S EV I DE N T FROM T HE M A T E RI AL ON RECORD. A VALUATION DONE BY A TECHNICAL EXPERT IN I TS FIELD OF OPERATION AND THE OP INI O N O F T H E EXPE R T CANNOT BE THROWN OUT W I THOUT BRING I NG ANY MATERIA L CON TR A RY T O T H E ONE ON RECORD. THE APPELLANT HAS NOT BROUGHT ANY SUCH I NSTANCES BASE D UPON W H I CH THE REPORT OF THE DVO CAN BE MODIFIED OR REJECTED. IN THE CIRCUMSTANCES AND GIVE N FACTS OF THE CASE THE APPELLANT HAS NOT BEEN ABLE TO DEMONSTRATE AND DISCHARGE THE ONUS TO PROVE THAT THE FA I R VALUE OF THE PROPERTY TO BE LESS THAN THE STAMP DUTY VALUATION SO THAT THE FAIR VALUE COU LD BE ADOPTED . 5 3.5.1 IN THE CASE OF S M T . BHART I JAYESH SANGAV I VS I TO ( 20 11) 128 IT O 345 (MUM), I T WAS HELD THAT T HE REPORT OF THE DVO IS BINDING ON T H E A S SE S S I N G OFFICER AND THE ASSESSING OFFICER HAS NO AUTHORITY TO SIT OVER THE J U DGE M E NT O F THE DVO. IT ALSO HELD THAT THE ASSESS I NG OFF I CER HAS EVERY RIQHT T O Q U ES TI O N T HE VERAC I TY OF REPORT OF THE REGIS T E R E D V ALUER B U T HE CAN N OT DOUB T T HE WO RK DONE BY T HE DVO AND IF THE ASSESS ING OFFICER I S ALLO WED TO FIN D F A UL T S WITH THE R EPO RT O F T H E DVO AND CONSEQUEN T L Y IGNOR E IT , I T WOU LD HAVE SE RI OUS R EP E RCUSSIO N O N TH E W O RKIN G OF THE DEPAR TM ENT I N AS MUCH AS IT WOU L D AM O U N T TO ONE W IN G OF THE D E P ARTMENT DOU BT ING TH E L IAB ILIT Y OF TH E WORK ASSI G NE D T O O THER WING WHI C H HAS BEEN CREATED FOR THIS P UR PO SE. IN VIEW OF TH E ABOVE F ACTS T HE CO NT E NT IO N R AI S ED BY THE APPELLANT IS FOUND TO BE NOT TENABLE. 3.6 SECTION 50C REQUIRES ADOPTION OF GUIDELINES VAL UE OR VALUE AS PER BASIC VALUATION REGISTER ON THE BASIS OF WHICH STAMP DUTY (STAMP VALUE) IS RECKONED. AT THE SAME TIME , AN OPTION IS GIVEN TO THE SELLER EITHER TO APPEAL AGAINST THE VALUE ADOPT ED FOR REGISTRATION OR TO REFER THE MATTER TO THE VALUATION OFFICER. AF TER THE PROVISION HAS COME INTO EFFECT, IT IS REQUIRED TO BE TREATED AS A MANDATE OF LAW BY SUBSTITUTING STAMP DUTY VALUE FOR APPARENT CONSIDER ATION EXCEPT BY FOLLOWING THE PROCEDURE LAID DOWN IN THE SECTION IT SELF. HOWEVER, AN OPPORTUNITY IS REQUIRED TO BE GIVEN TO THE ASSESSEE TO QUESTION THE VALUATION AS PROVIDED IN THE PROVISION ITSELF. BUT WHERE THE ASSESSEE HAD NOT AVAILED THE OPPORTUNITY, THE AO. IS BOUND T O FOLLOW THE MANDATE OF LAW, IT WAS SO HELD IN THE CASE OF AMBAT TUR CLOTHING CO. LTD. VS ACIT (2010) 326 ITR 245 (MAD). IN THE CASE OF MOHD. SHOIB VS DCIT (2010) 127 TTJ 459 (LUCKNOW)(TRIB) /1 ITR 4 52 , IT WAS HELD THAT WHERE NO CLAIM IS MADE AT ALL BY THE ASSESSEE DISPUTING THE SUBSTITUTION OF STAMP VALUE FOR THE CONSIDERATION D ECLARED BY HIM, THE PROVISION IS BOUND TO BE APPLIED. WHEN THE ASSE SSEE HAS ANY OBJECTION TO THE ADOPTION OF THE STAMP DUTY VALUE A S AGAINST THE CONSIDERATION ADMITTED, THE LAW PROVIDES A REMEDY I N - SUB-SECTION (2) OF SECTION 50C, WHERE HE/SHE DOES NOT EXERCISE HIS/HER RIGHT UNDER THE LAW , THE AO. IS BOUND TO ADOPT THE STAMP VALUE . WHERE THE ASSESSING OFFICER REFERS THE MATTER TO VALUATIO N CELL ON ASSESSEE ' S OBJECTION HE HAS TO AWAIT SUCH VALUATION SO THAT THE ADOPTION OF STAMP DUTY VALUE WITHOUT AWAITING THE V ALUATION REPORT WOULD NOT BE VALID . IN SUCH A SITUATION SUB-SECTIONS (2) AND (3) OF SECTION 50C WOULD BE APPLICABLE AND THE AO. WILL HA VE TO MAKE A REFERENCE TO THE VALUATION OFFICER . THEREAFTER, WHERE VALUATION DONE BY THE DVO IS MORE THAT THE STAMP VALUATION AUTHORI TY , THEN VALUATION DONE BY THE STAMP VALUE AUTHORITIES WILL BE ADOPTED AS SALE CONSIDERATION WHICH THE A . O. HAS NOT ADOPTED, BUT WHERE VALUATION DONE BY THE DVO IS LOWER THAN THE VALUATI ON SHOWN BY THE STAMP VALUE AUTHORITIES , THEN THE VALUATION DONE BY THE DVO IS TO BE ADOPTED AS SALE CONSIDERAT I ON IN P L ACE OF T HE ACTUAL SALE CONSIDERA TI ON SHOWN BY THE APPELLANT . THIS VIEW H AS B EE N UPHELD IN M ANY TRIBUNAL DECISIO NS THAT W HERE THE ASSESSEE HAD OBJEC T E D T O THE AC TI O N O F THE AO . IN ADOPTING THE S TAM P DUTY VALUE - IN PLACE OF STATED CONSIDE R AT I ON I N SALE DEED , THE A.O OU G HT T O MAK E A REFERENCE TO THE VALUATION OFFICER FOR VA LU ATION OF THE SAID PROPERTY IN ACCO RDANC E WITH THE PROVISIONS OF SECT I ON 50C ( 2 )(A). A FEW CITATIONS OF SUCH D EC ISIONS A RE QUOTED BELOW: 1. SMT. T.V. NAGASENA VS. ITO (2012) 53 SOT 166 (BANG) 2. SMT. NANDITA KHOSLA VS. ITO (2011) 46 SOT 90 (MUM) 6 3. SMT. ARLETTE RODRIGUES VS. ITO (2011) 46 SOT 199 (MU M) (URO) /10 TAXMANN.COM 235 (MUM.) 3.6.1 IN THE CASE OF AKG CONSULTANTS (P) LTD VS ITO (2007) 17 SOT 592 (LUCK) IT WAS HELD THAT SEC 50C (1) IS MANDATOR Y WHEREBY THERE IS NO OPTION TO THE ASSESSING OFFICER BUT TO ADOPT THE VALUATION DONE , BY THE STAMP VALUATION AUTHORITY IN PLAC E3 , OF CONSIDERATION SHOWN BY THE ASSESSEE IF VALUATION DONE BY THE STAMP VALU ATION AUTHORITY IS MORE THEN THE CONSIDERATION SHOWN BY THE ASSESSE E . 3.6.2 IN THE CASE OF MEGHRAJ BAID VS ITO (2008) 23 SOT 25 (JODH) IT WAS HELD THAT IN CASE THE ASSESSING OFFICER DOES NO T AGREE WITH THE EXPLANATION OF THE ASSESSEE, WITH REGARD TO LOWER C ONSIDERATION DISCLOSED BY HIM THEN HE SHOULD REFER THE MATTER TO DVO FOR GETTING ITS MARKET RATES ESTABLISHED AS ON DATE OF THE SALE TO ARRIVE AT THE CORRECT SALE CONSIDERATION. IF THIS PROVISION IS R EAD IN THE SENSE THAT THE ASSESSING OFFICER IS NOT SATISFIED WITH THE EXPLANATION OF TH E ASSESSEE THEN HE 'MAY' OR 'MAY NOT' SEND THE - MATTER FOR ' VALUATION TO THE DEPARTMENTAL VALUATION OFFICER THEN IN THAT CASE THE PROVISION WOULD BE RENDERED REDUNDANT . THE WORD USED IN SEC 50C(2) SIGNIFIES THAT IN CASE THE ASSESSING OFFICER IS NOT SATISFIED WITH THE EXPLANATION OF THE ASSESSEE HE 'SHOULD' REFER THE M ATTER TO THE DVO FOR THE MENTIONED PURPOSE . IN THE PRESENT CASE THE ASSESS I NG OFFICER HAVING BEEN NOT SATISFIED WITH THE EXPLANATION OF T HE APPELLANT WITH RESPECT TO THE VALUATION OF THE PROPERTY HAS THUS A S PER THE MANDATORY PROVISIONS OF THE ACT HAS REFERRED TO THE DVO DURING THE ASSESSMENT PROCEEDINGS . THE ASSESSING OFFICER IN THE PRESENT CASE HAS MADE A REFERENCE . TO THE DVO AS PER THE PROVISIONS OF SECTION 50C(2). HOWEVER, THE VALUATION OF THE PROPERTY BY T HE DVO IS HIGHER THAN MARKET VALUE ARRIVED AT BY STAMP VALUATION AUT HORITY . IN THE CASE OF JITENDRA MOHAN SAXENA VS ITO (2008) 305 ITR 62 (LUCK) WHERE VALUATION MADE BY DVO I S HIGHER THAN THE VALUATION MADE BY THE STA MP -- VALUATION AUTHORITY WILL BE ADOPTED FOR SALE CONSIDERATION DECLARED BUT WHERE THE ---- VALUATION MADE BY DVO IS LESS THAN THE VALUATION MADE BY THE STAMP VAL U E AUTHORITY, THEN AO. MAY ADOPT SUCH FAIR MARKET VALUE TO BE THE FULL VALUE O F CONSIDERATION. THE MATERIAL ON R ECORD I ND ICATES THAT THE ASSESSING OFFICER HAS ADOPTED THE VALUE DETERMINED BY THE DVO AT RS. 1,10,37,378/- , WHICH IS SEEN TO BE HIGHER THAN THE STAMP DUTY VALUE OF RS . 98,27 , 412/-. IN THE CIRCUMSTANCES AND FACTS OF THE CASE AND THE PROVISIONS OF THE ACT THE ASSESSING OFFICER IS DIRECTED TO ADOPT THE VALUE AS PER THE STAMP DUTY VALUATION AUT HORITY AS AGAINST THE HIGHER VALUATION ADOPTED AS PER THE DVO 'S REPORT. 3.7 THUS, TAKING INTO ACCOUNT THE ENTIRE FACTS IN T OTALITY AND THE RATIO OF THE JUDICIAL DECISIONS THE FAIR VALUE TAKEN BY T HE DVO BEING RS. 1,10,37,378/-, WHICH IS HIGHER THAN THE STAMP DUTY VALUE OF RS. 98,27 , 4121- (19,38,732 + 78 , 88,680) FOR THE SHOP AND BASEMENT, THE ASSESSING OFFICER IS DIRECTED TO ADOPT THE STAM P DUTY VALUE AS PER THE PROVISIONS OF SECTION 50C(2) AND (3) OF THE ACT. 3.8 IN VIEW OF THE ABOVE FACTS AND RATIO OF JUDICI AL DECISIONS CITED SUPRA, GROUND OF APPEAL NO. 1 RAISED BY THE APPELLA NT IS PARTLY ALLOWED. 7 AGGRIEVED BY THE ORDER OF LD.CIT(A), ASSESSEE IS NOW IN APP EAL BEFORE US. 4. BEFORE US, LD.A.R. REITERATED THE SUBMISSIONS MADE BEFORE AO AND LD.CIT(A) AND FURTHER SUBMITTED THAT THE DEPARTME NTAL VALUATION OFFICER (DVO) HAS NOTED THE BIG DRAW BACKS OF THE PROPERTY WHILE UNDERTAKING THE VALUATION AND FURTHER HE CONSIDERED THE FAIR MARKET VALUE ON THE BASIS OF OTHER PR EMISES SITUATED AT PRIME LOCATIONS IN THE NEARBY AREA WHICH ARE NOT AT ALL COMPARABLE WITH THE OFFICE PREMISES OF THE ASSESSEE. HE FU RTHER SUBMITTED THAT ASSESSEE HAD GOT THE VALUATION DONE THR OUGH GOVERNMENT REGISTERED VALUER WHO HAD DETERMINED THE MA RKETABLE VALUE OF THE PROPERTIES AT RS.48.31 LAKHS FOR BASEMENT AND RS.14.26 LAKHS (SHOP) RESPECTIVELY. HE THEREFORE SUBMITTED THAT THE VALUATION REPORT OF THE REGISTERED VALUER SHOULD HAVE CONSIDERED WHILE DETERMINING THE FAIR MARKET VALUE. LD.A.R. FURTHER SUBMITTED THAT THE YEAR OF CONSTRUCTION OF THES E SALES INSTANCES ARE NOT STATED WHILE THE PREMISES OF THE ASSE SSEE IS MORE THAN 25 YEARS OLD. HE FURTHER STATED THAT AT TH E TIME OF INSPECTION BY DVO, THE SUBSEQUENT PURCHASER HAD MADE C HANGES AND RE-FURNISHED THE PREMISES AND MADE MODIFICATION TO THE TOTAL INTERIORS AND THE REAL CONDITION OF THE PREMISES AT THE TIM E OF SALE WAS NOT IN EXISTENCE AT THE TIME OF INSPECTION BY THE D VO. LD.D.R. ON THE OTHER HAND, SUPPORTED THE ORDER OF AO. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESPECT TO VALUATION OF PROPERTY U/S 50C FOR THE PURPOSE OF COMPUTA TION OF 8 CAPITAL GAINS. IN THE PRESENT CASE, WE FIND THAT THE DVO VALUED THE PROPERTIES AT RS.1,10,37,000/- BASED ON THE COMPARAB LE SALE INSTANCES NEARBY THE PROPERTY THAT WAS OLD. AT THE SA ME TIME, WE ALSO FIND THAT ASSESSEE FILED VALUATION REPORT OF M/S.KULKAR NI VALUERS PVT. LTD., WHICH IS PLACED AT PAGES 39 TO 45 OF THE PAPER BOOK. THE VALUER HAS DESCRIBED THE CONDITION OF THE PRO PERTY TO BE BAD AND HAS STATED THE MARKETABILITY OF THE BASEMENT AND ALSO THE SHOP TO BE BAD. HE THEREAFTER DETERMINED THE VALUE OF SHOP AT RS.14,26,000/- AND OF BASEMENT AT RS.48.31 LACS. BEFORE US , THE SUBMISSIONS OF THE ASSESSEE HAVE NOT BEEN CONTROVERTED BY THE REVENUE. CONSIDERING THE TOTALITY OF THE AFORESAID FACTS, W E ARE OF THE VIEW THAT THE ISSUE HAS TO BE RE-EXAMINED AT THE E ND OF AO. WE THEREFORE RESTORE THE ISSUE BACK TO THE AO TO RE-DETE RMINE THE CAPITAL GAINS AFTER CONSIDERING THE VALUATION REPORT GIVEN B Y THE VALUER AND IN ACCORDANCE WITH THE LAW. THE ASSESSEE IS ALSO DIRECTED TO CO-OPERATE BY FURNISHING THE NECESSARY DETA ILS. THUS, THE GROUNDS OF THE ASSESSEE ARE ALLOWED FOR STATIST ICAL PURPOSE. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSE. ORDER PRONOUNCED ON 30 TH DAY OF JUNE, 2017. SD/- SD/- ( SUSHMA CHOWLA ) ( ANIL CHATURVEDI ) ! / JUDICIAL MEMBER '! / ACCOUNTANT MEMBER PUNE; ! DATED : 30 TH JUNE, 2017. YAMINI 9 #$%&'('% / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. 4. 5. 6. CIT(A)-3, PUNE. PRL.CIT-2, PUNE. #$% &&'(,* '(, / DR, ITAT, A PUNE; %+,-/ GUARD FILE. / BY ORDER, // //// // TRUE COP // /// TRUE // //COPY // TRUE COPY // // . /012 / ASSISTANT REGISTRAR, * '( , / ITAT, PUNE.